Appeal from an order of the United States District Court for the Eastern District of New York, Charles P. Sifton, Judge, modifying an injunction entered following the decision of this Court in United States v. Charmer Industries, Inc., 711 F.2d 1164 (1983), to remove certain prohibitions on use by Arizona Attorney General of United States Probation Service presentence report on appellant. Motion by appellant to hold Arizona Attorney General and others in civil and criminal contempt of court for breach of undertakings made to court.
Friendly, Kearse, and Winter, Circuit Judges.
This appeal by Peerless Importers, Inc. ("Peerless"), presents a question as to the scope of the injunctive order that should be entered following the unauthorized acquisition of a confidential presentence report prepared for the court by the United States Probation Service ("USPS"). In our earlier opinion in this case, United States v. Charmer Industries, Inc., 711 F.2d 1164 (1983) (" Charmer I "), we restricted publication or other use by the Attorney General of the State of Arizona ("Arizona AG") of a presentence report on Peerless ("Peerless Report" or "Report") that had been prepared by USPS in an antitrust action in the Eastern District of New York in which Peerless was a defendant. Upon the issuance of our mandate in Charmer I on July 15, 1983, the United States District Court for the Eastern District of New York, Charles P. Sifton, Judge, entered an order that prohibited the Arizona AG from "making any publication or other use of any portion of the Report or of any information derived therefrom." On July 26, 1983, the district court modified its order ("Modified Order") to delete the prohibition on use of "derived" information. Peerless contends that both our opinion in Charmer I and improper conduct by the Arizona AG require the reversal of the Modified Order and the entry of an order prohibiting the Arizona AG from using both the Report and any information derived from it. In addition, Peerless asks us to hold the Arizona AG, the Chief Counsel of the Financial Fraud Division of the Arizona AG, two Assistant Arizona AGs, and the Superintendent of the Arizona Department of Liquor Licenses and Control ("DLLC") (collectively referred to as the "Arizona AG, et al.") in civil and criminal contempt of court because of breaches by the Arizona AG of promises, made by his representative to this Court during oral argument on Charmer I, not to use the Report.
For the reasons below, we deny the contempt motion, and we vacate the Modified Order in part, with instructions to enter a new injunctive order.
For purposes of the present appeal, we assume familiarity with Charmer I and summarize only briefly the important events leading to that appeal.
In 1982 the DLLC commenced a proceeding to revoke the liquor license of All American Distributing Co., Inc. ("All American"), a Peerless affiliate, in part on account of Peerless's plea of guilty to price fixing in the antitrust action. On March 7, 1983, Arizona Assistant Attorney General Therese L. Martin obtained the unauthorized disclosure of USPS's presentence report on Peerless. Martin then caused to be prepared an amended complaint in the DLLC proceeding in which the first paragraph, based on the Peerless Report, charged that Peerless had ties to organized crime. Martin delayed action on filing the amended complaint while she attempted to obtain written confirmation that it was permissible for the Arizona AG to use the Peerless Report. On March 24, however, when Martin was notified that Peerless intended later that day to ask Judge Sifton to enjoin the Arizona AG from publishing, discussing, or using the Report, Martin reported this to her superior, causing the amended complaint to be filed in the state proceeding immediately, without awaiting the normally required permission of the DLLC hearing officer.
Judge Sifton subsequently denied Peerless's motion to forbid the Arizona AG's use of the Report. Peerless immediately appealed and moved for a stay pending appeal. The motion was granted on April 12 by a panel of this Court on the condition that Peerless agree to an adjournment of a scheduled hearing in the DLLC proceeding. Peerless declined so to agree, however, and on April 15 an order was entered denying the stay.
A. Oral Argument in Charmer I and Events Prior to the Decision
On April 29, 1983, oral argument in Charmer I was heard, during which the following colloquy occurred between Martin and the Court:
JUDGE FRIENDLY: And when you finish up, I suppose you intend to release this [Report] to the media too, don't you?
MS. MARTIN: Your Honor, if it is admitted at the hearing, it would be a matter of public record.
JUDGE FRIENDLY: Or do you plan to before the hearing?
MS. MARTIN: No, Your Honor.
JUDGE FRIENDLY: You agree you won't do that?
MS. MARTIN: Yes, I [would] agree I would not do that, except in the context of perhaps using it in a deposition.
(Transcript of Excerpts from April 29, 1983 Argument ("Tr. Excerpts") at 3.)*fn1 At the close of oral argument, decision was reserved.
On May 4, 1983, during a deposition of the Superintendent of the DLLC in connection with the state proceeding, the Superintendent indicated, in response to questioning by counsel for All American, that Paragraph I of the amended complaint, which charged that Peerless had ties to organized crime, was based on the Peerless Report and would have to be withdrawn if the Report could not be used to substantiate it. On May 16, counsel for Peerless filed a motion requesting a transcript of the oral argument of Charmer I from the Court, stating that he believed that Martin had promised she would not use the Report until this Court rendered its decision. The Court ordered a transcript prepared. On May 19, Martin wrote to counsel for Peerless, stating that her contrary recollection was that she had represented to the Court that she planned to use the Report at depositions and in the state court hearing. By motion dated May 25, filed on June 1, Martin moved for her own copy of the transcript of the ...